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Can expertise mitigate auditors’ unintentional biases?

Author

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  • Guiral, Andres
  • Rodgers, Waymond
  • Ruiz, Emiliano
  • Gonzalo-Angulo, Jose A.

Abstract

It is important for both academics and practitioners to understand how biases influence auditing opinions, as well as how we might counteract those biases. According to moral seduction theory, auditors’ judgments are morally induced by conflicts of interest in an unconscious manner. We combined an auditor ethical decision-making model with an expertise model in a laboratory experiment with European auditors to demonstrate that expertise helps to mitigate unconscious reporting bias in the going-concern setting. Our findings suggest that while problem-solving ability reinforces the auditors’ public watchdog function, task-specific experience reduces their fear of provoking the self-fulfilling prophecy effect. Our contribution to the literature is timely since the European Green Paper on Auditing is ignoring auditor education, learning, and training as potentially effective ways to enhance audit quality and increase professional skepticism.

Suggested Citation

  • Guiral, Andres & Rodgers, Waymond & Ruiz, Emiliano & Gonzalo-Angulo, Jose A., 2015. "Can expertise mitigate auditors’ unintentional biases?," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 24(C), pages 105-117.
  • Handle: RePEc:eee:jiaata:v:24:y:2015:i:c:p:105-117
    DOI: 10.1016/j.intaccaudtax.2014.11.002
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    References listed on IDEAS

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    11. Andrés Guiral & Waymond Rodgers & Emiliano Ruiz & José Gonzalo, 2010. "Ethical Dilemmas in Auditing: Dishonesty or Unintentional Bias?," Journal of Business Ethics, Springer, vol. 91(1), pages 151-166, February.
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    Cited by:

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    2. Papirakis, Rachel, 2022. "Auditors’ self-actualization and ability to resist client pressure: Evidence from Canada," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 47(C).
    3. Ionica Oncioiu & Anca-Gabriela Petrescu & Florentina-Raluca Bîlcan & Marius Petrescu & Melinda Timea Fülöp & Dan Ioan Topor, 2020. "The Influence of Corporate Governance Systems on a Company’s Market Value," Sustainability, MDPI, vol. 12(8), pages 1-15, April.
    4. Eriana Kartadjumena & Waymond Rodgers, 2019. "Executive Compensation, Sustainability, Climate, Environmental Concerns, and Company Financial Performance: Evidence from Indonesian Commercial Banks," Sustainability, MDPI, vol. 11(6), pages 1-21, March.
    5. Waymond Rodgers & Andrés Guiral & José A. Gonzalo, 2019. "Trusting/Distrusting Auditors’ Opinions," Sustainability, MDPI, vol. 11(6), pages 1-16, March.
    6. Agarwalla, Sobhesh Kumar & Desai, Naman & Tripathy, Arindam, 2017. "The impact of self-deception and professional skepticism on perceptions of ethicality," Advances in accounting, Elsevier, vol. 37(C), pages 85-93.

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